KA UNIVERSITY EXAMINATIONS:2021/2022 SCHOOL OF BUSINESS ORDINARY EXAMINATION FOR BACHEOR OF PROCUREMENT & LOGISTICS ACC 2102: COST ACCOUNTING II DATE: DECEMBER 2021 TIME: 2 HOURS INSTRUCTIONS: ANSWER QUESTION ONE AND ANY OTHER TWO QUESTION ONE (20 MARKS) An organization is using linear regression analysis to establish an equation that shows a relationship between advertising expenditure and sales revenue. It will then use the equation to predict sales revenue for given levels of advertising expenditure. Data for the last five periods are as follows: Sales revenue (Sh) Period number Advertising 1 2 3 4 5 Expenditure (Sh) 17,000 19,000 24,000 22,000 18,000 108,000 116,000 141,000 123,000 112,000 Required: i. Using high low method, establish the cost estimation equation. (7 Marks) ii. Using Regression analysis, derive the cost estimation equation iii. Outline 5 advantages of regression analysis as a method of cost estimation (5Marks) (8 Marks)